The exercise of stock options is the most common point of taxation in most countries. Only a few countries allow postponing the tax until later, under specific conditions. However, the benefit arising from stock options doesn’t immediately translate to cash gains. The tax obligations on the benefit are often referred to as ‘dry taxes’ due to the absence of available liquidity for payment. Some countries give tax reliefs for the employee share plans so that the tax obligation occurs only once. Typically the tax is postponed until the sale of shares. Conditions may include obligation to notify tax authorities of the option plan or certain holding period of the options (e.g in Estonia, it is three years). However, many countries do tax income from stock options twice – first, at exercise and then again, at sale. Unverified source (2024)